Thursday, August 28, 2014

The problem with "memo bills"

I'm not sure if there's a formal definition of a "memo bill," but in my office we think of it as any payer-generated document showing an account number and an amount owed that is mailed in along with a payment. Typically, these are statements created in-house by businesses, law firms, or banks.

Judging from a May 2014 sample of payments we received, almost 15 percent of non-escrow tax payments are made by taxpayers who provide a memo bill rather than the remittance coupon we provided during billing.

Tax payments to Decatur are processed in a high-volume processing center at our bank. The processors are under instructions from my office to key in information provided on the check and the remittance coupons. The processors thrive with consistency--the more standardized the checks and coupons are, the more accurately they key in information, and the more seemlessly my office is able to import bank data to minimize posting delays or errors.

The memo bills we receive are formatted in a wide variety of irregular formats. Bank processors are not always able to readily identify property IDs on memo bills that might reference loan numbers and other extraneous data. Also, memo bills frequently lack critical but basic information such as which tax year the payment is intended for. Without a property ID and tax year, the payment cannot be applied to the correct account in an automated fashion--it kicks out as an exception that one of Decatur's revenue officers must research and post manually. This means that a significant amount of staff time (and wages) go toward reviewing memo bills to reconcile them to the appropriate account and tax installment.

Therefore, our policy and preference is to receive tax payments with the original remittance coupon we provide, or with a copy of the bill from our website ( Our residents do a fantastic job at including the coupons, but we need some help from certain companies that continue to generate memo bills. In the weeks and months to come, we may begin following up with letters to these memo bill creators stating that we are unable to continue accepting memo bills.

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